Mortgage Demand Up 10 Percent From Last Year, For This Week
One thing that the media is guilty of, as am I, is that once a storyline becomes fixed in the mindset of the country we try to feed it. So a credit crunch is all encompassing, lending is moribund, and the there is little that can be done.
Then a report from the mortgage bankers comes out that goes against the grain. Instead of lending dropping we hear that for this week at least, lending is up 10.5 percent from the year ago period. That is with the media screaming lending is dead and disincenting the populace from seeking a loan. So while Alt-A and Subprime are tools that may not be in the lenders toolkits for a while, the lending to solid borrowers continues to be strong.
The Mortgage Bankers Association said its seasonally adjusted index of mortgage applications, which includes both purchase and refinance loans, for the week ended Aug. 24 fell 4.0% to 615.2.
Applications, however, were 10.5% above their year-ago level.
Borrowing costs on 30-year fixed-rate mortgages, excluding fees, averaged 6.41%, down 0.08 percentage point from the previous week. Interest rates were above year-ago levels, which averaged 6.39%.
The four-week moving average of mortgage applications, which smooths the volatile weekly figures, was up 0.3% to 647.9. via USATODAY.com
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Comment by Sue on 29 August 2007:
Interesting. I guess those who have solid credit, provable income and decent down payments or equity are taking advantage of the low interest rates and/or prices. Nice to know that there are still some people out there in that situation!
Comment by Jerry on 29 August 2007:
Dont fall for the “mortgage applications up” trap. Folks now having to apply numerous times to find a place that will approve their loan adds numbers to that pile. If applications were up, then sales volume would pick up, and that is not going to happen. Also consider the basket of mortgage units polled wre probably the larger firms, and now that they are the only ones left, applications may rise in this survey, but not rise in hard numbers.
Comment by Dan on 29 August 2007:
Jerry is correct. just cause mort. apps are up, doesn’t mean actual lending is up.